Financing in place for art institute residence hall

The Ohio Higher Educational Facility Commission is expected to issue bonds next week enabling the Cleveland Institute of Art to buy a residence hall that opened last month.

In a news release, KeyBanc Capital Markets Inc., the corporate and investment banking arm of Cleveland-based KeyCorp, said it will issue approximately $17.5 million in Higher Educational Facility Revenue Bonds for CIA to pay the costs of acquiring the four-story, 203-bed building on a site formerly occupied by the former Cleveland Food Co-Op at East 117th Street and Euclid Avenue. The bonds, rated BB by S&P Global Ratings, are currently scheduled to price on Sept. 11.

The building was constructed by NewBrook Partners of Rocky River, with the intention of owning the building while CIA would control the property through a master lease agreement. NewBrook has worked on student residential projects including the Langston at Cleveland State University and similar projects in Kent and Oxford.

Almut Zvosec, CIA’s vice president of business affairs, told Crain’s that CIA will use the bond financing to buy the building from NewBrook.

CIA has about 625 students from around the globe.

“Our mission is to nurture the intellectual, artistic and professional development of students and community members through rigorous visual arts and design education,” said CIA president Grafton Nunes in the KeyBanc press release. “As part of that mission, we continually look for ways to enhance the on-campus experience for our students. Through this financing, we’re able to offer more housing options and accessibility to our facilities, which is particularly helpful for many of our out-of-state students.”

Earlier this year, KCBM was senior manager for a $75 million in Cleveland-Cuyahoga County Port Authority bonds for the Playhouse Square Foundation, part of which were used for The Lumen, the 34-story luxury apartment tower in downtown Cleveland’s theater district.

“It was an honor to work with the Institute and Commission on the financing for this project, which will help bring students to the area and further enhance Cleveland’s cultural district,” said Tim Kelly, a director at KCBM in the press release.